Patent costs are 30% of a new phone's retail price

According to a new report, 30% of the price you pay for a new smartphone represents the cost of acquiring licenses to use patented technology. Titled The Smartphone Royalty Stack: Surveying Royalty Demands for the Components Within Modern Smartphones, the report was written by patent litigators Joe Mueller and Tim Syrett, along with Intel Vice President and Associate General Counsel Ann Armstrong.



Using publicly disclosed information, the authors came to the conclusion that $120 out of the cost of a $400 hypothetical smartphone is used to make royalty payments to patent holders. The average ...